SEC Form DEF 14A filed by Carriage Services Inc.

March 29, 2024

Dear Fellow Shareholder:

We are pleased to invite you to the 2024 Annual Meeting of Shareholders of Carriage Services, Inc. (“Carriage”). The Annual Meeting will be held at 3040 Post Oak Boulevard, Lobby Conference Room, Houston, Texas 77056 on Tuesday, May 14, 2024, at 9:00 a.m., Central Time. Whether or not you plan to attend the Annual Meeting, we ask that you participate by casting your vote at your earliest convenience.

2023 will be remembered as a milestone year in Carriage’s history, as we finalized Mel Payne’s CEO succession plan that he first announced in June 2021, added diverse new skill sets to our Board with the addition of three new Directors, acquired and began the integration of one of the highest revenue generating businesses in the Company’s history, and continued our shareholder engagement focus, acting upon much of the feedback we received, which will be highlighted throughout this Proxy Statement.

As we wrap up the first quarter of 2024 and look forward to the journey ahead for our Company, we are excited about our vision of the future of Carriage, which we recently highlighted with our new purpose statement: ‘Creating premier experiences through innovation, empowered partnership, and elevated service.’ This new purpose statement continues to build upon the foundation that set us apart when we were founded in 1991 by Mel and, by embracing this new cultural mindset, will be central to our growth and continued journey as leaders in the funeral and cemetery profession. With this renewed focus, we will prioritize innovative thought, challenging norms, and fostering strong partnerships leading to exceptional service across the Carriage family, all of which we believe will support our strategic initiatives and drive value creation for our shareholders.

As Non-Executive Chairman and Vice Chairman of the Board of Directors, we encourage our shareholders to take the time to get to know the story of Carriage, our history, vision, and strategy, and the people who are leading our Company to new heights by embracing our rich history and unique culture while continuously working to identify areas where we can get even better. Before voting your shares, we encourage you to read our releases and reach out if you have questions or would like to learn more. Both our Board and Executive Management team will be happy to visit with you, or put you in touch with any one of our wonderful leaders located throughout the country.

As we have done many times before, we invite all shareholders to visit any of our businesses or travel to Houston to meet our Support Center team, where you can see our teams working towards creating a premier experience through innovation, empowered partnership, and elevated service for our Company and the families we serve.

We hope you can join us on May 14^th and we encourage you to read the Notice of Annual Meeting and Proxy Statement, which contains information about the voting options, instructions, and descriptions of the proposals for this meeting. It is important that your voice is heard and your shares are represented at the Annual Meeting by casting your vote as soon as possible. Thank you for your belief in, and support of, Carriage and the people who serve our families and drive high performance every day across our portfolio of funeral homes and cemeteries.

Sincerely,

Chad Fargason Non-Executive Chairman of the Board				Carlos R. Quezada. Vice Chair of the Board and Chief Executive Officer

CARRIAGE SERVICES, INC.

3040 Post Oak Boulevard, Suite 300

Houston, Texas 77056

NOTICE OF 2024 ANNUAL MEETING OF SHAREHOLDERS

		VIA THE INTERNET Visit the website listed on your proxy card				BY MAIL Sign, date and return your proxy card in the enclosed envelope				IN PERSON Attend the Annual Meeting

We are pleased to continue taking advantage of the Notice & Access method of delivery for our Annual Report, Proxy Statement and other Proxy materials (collectively the “Proxy Materials”). The Proxy Materials will be available online as described in this Proxy Statement and hard copies will not be delivered, unless expressly requested by a shareholder.

On or about March 29, 2024, we will begin mailing a Notice of Internet Availability of Proxy Materials (the “Notice”) detailing how to access the Proxy Materials electronically and how to submit your proxy via the Internet. You are entitled to vote if you were a shareholder of record on March 15, 2024. The Notice also provides instructions on how to request and obtain paper copies of the Proxy Materials and proxy card or voting instruction form, as applicable. We continue to believe this process provides our shareholders with a convenient way to access the Proxy Materials and submit their proxies online, while reducing the environmental impact of our Annual Meeting and lowering the costs of printing and distribution.

If your shares are held in a stock brokerage account or by a financial institution or other record holder, follow the voting instructions on the form that you receive from them. The availability of telephone and internet voting will depend on their voting process. Please note that you will need the control number provided on your Notice of Internet Availability of Proxy Materials in order to submit your proxy online.

By order of the Board of Directors,

Steven D. Metzger

President & Secretary

March 29, 2024

TABLE OF CONTENTS

PROXY STATEMENT

This Proxy Statement is being furnished to you by the Board of Directors (our “Board”) of Carriage Services, Inc. (“Carriage Services,” “Carriage,” the “Company,” “we,” “us” or “our”) for use at our 2024 Annual Meeting of Shareholders (our “Annual Meeting”).

Annual Meeting Date and Location

We intend to hold our Annual Meeting in person at our offices at 3040 Post Oak Boulevard, Lobby Conference Room, Houston, Texas 77056, on Tuesday, May 14, 2024, at 9:00 a.m., Central Time. If you plan to attend in person, please use the main lobby entrance where you will see an area to check in prior to entering the room.

In the event circumstances change to prevent or limit an in-person meeting, we may implement additional procedures or limitations on meeting attendees or determine that alternate Annual Meeting arrangements are advisable or required (i.e., a virtual-only meeting). If we determine that such alternative arrangements are advisable or required, then we will announce our decision and post additional information on our Investors Relations website at www.carriageservices.com and file a notice with the SEC. Please check this website in advance of the Annual Meeting date if you are planning to attend in person.

Delivery of Proxy Materials

Mailing Date and Delivery of Proxy Materials

On or about March 29, 2024, we will begin mailing a Notice of Internet Availability of Proxy Materials (the “Notice of Availability”) to our shareholders containing instructions on how to access the Proxy Materials and submit your proxy online. We have made these Proxy Materials available to you over the internet or, upon your request, have delivered paper copies of these materials to you by mail, in connection with the solicitation of proxies by the Board for our Annual Meeting.

Shareholders Sharing the Same Address

Each shareholder of record will receive one Notice of Internet Availability, regardless of whether you have the same address as another registered shareholder. If your shares are held in “street name” (that is, in the name of a financial institution, broker or other holder of record), applicable rules permit brokerage firms and the Company, under certain circumstances, to send one Notice of Internet Availability to multiple shareholders who share the same address. This practice is known as “householding.” Householding saves printing and postage costs by reducing duplicate mailings. If you hold your shares through a broker, you may have consented to reducing the number of copies of materials delivered to your address. In the event that you wish to revoke a “householding” consent you previously provided, you must contact your broker to revoke your consent. You may also contact the Company directly to request copies of materials by submitting a written request to our Corporate Secretary at 3040 Post Oak Boulevard, Suite 300, Houston, TX 77056. If your household is receiving multiple copies of the Notice of Availability and you wish to request delivery of a single copy, you should contact your broker directly.

Questions and Answers About Our Annual Meeting and Voting

Why am I receiving these proxy materials?

Our Board is soliciting your proxy to vote at our Annual Meeting because you owned shares of our common stock, par value $.01 per share (the “Common Stock”) at the close of business on March 14, 2024, the record date for our Annual Meeting (the “Record Date”), and are therefore entitled to vote at our Annual Meeting.

This Proxy Statement, along with a proxy card, is made accessible, free of charge to you, via the Internet at http://investors.carriageservices.com/annuals-proxies.cfm, or if elected, mailed to our shareholders on or about March 29, 2024. This Proxy Statement summarizes the information that you need to know in

2024 Proxy Statement  1

Proxy Statement

order to cast your vote at our Annual Meeting. As a shareholder, your vote is very important and our Board strongly encourages you to exercise your right to vote. You do not need to attend our Annual Meeting in person to vote your shares. Whether or not you plan to attend our Annual Meeting, we encourage you to vote your shares by voting via the Internet or completing, signing, dating and returning the enclosed proxy card in the envelope provided. See “About Our Annual Meeting – How do I vote my shares?” below.

What am I voting on and how does our Board recommend that I vote?

We will also transact any other business as may properly come before the Annual Meeting or any adjournments or postponements thereof.

Our Board has appointed Carlos R. Quezada, our Vice Chairman of the Board and Chief Executive Officer (“CEO”) and Steven D. Metzger, our President and Secretary, as the management proxy holders for our Annual Meeting. For shareholders who have their shares voted by duly submitting a proxy via the Internet, by mail, or in person at our Annual Meeting, the management proxy holders will vote all shares represented by such valid proxies as our Board recommends, unless a shareholder appropriately specifies otherwise.

Who is entitled to vote at the meeting?

You may receive notice of and vote at our Annual Meeting if you were a shareholder of record as of the close of business on the Record Date. As of the Record Date, there were 15,149,686 shares of Common Stock outstanding and entitled to vote.

How many votes can I cast?

You are entitled to one vote for each share of Common Stock you owned on the Record Date on all matters presented at our Annual Meeting.

Why is my vote important?

Your vote is important regardless of how many shares of Common Stock you own. Please take the time to vote. Please read the instructions below, choose the way to vote that is easiest and most convenient to you and cast your vote as soon as possible.

What is the difference between a shareholder of record and a “street name” holder?

Most shareholders hold their shares through a financial institution, broker or other nominee rather than directly in their own name. As summarized below, there are some distinctions between shares held of record and those owned in street name.

2  Carriage Services

Proxy Statement

How do I vote my shares?

Shareholders of Record. There are three ways to vote:

Street Name Shareholder. There are three ways to vote:

May I change or revoke my vote?

Yes, if you are a shareholder of record, you may change your vote or revoke your proxy at any time before your shares are voted at the meeting by:

If you are a street name shareholder and you vote by proxy, you may change your vote by submitting new voting instructions to your financial institution, broker or other nominee in accordance with such entity’s procedures. Please refer to the materials that your financial institution, broker or other nominee provided to you.

2024 Proxy Statement  3

Proxy Statement

What is a quorum?

A quorum is the presence at our Annual Meeting, in person or by proxy, of the holders of a majority of the outstanding shares of our Common Stock entitled to vote on a matter at our Annual Meeting. There must be a quorum for our Annual Meeting to be held. If a quorum is not present, our Annual Meeting may be adjourned or postponed until a quorum is reached. Proxies received but marked as abstentions or broker non-votes will be included in the calculation of votes considered to be present at our Annual Meeting for the purpose of establishing a quorum.

What are “broker non-votes” and abstentions and how do they affect voting results?

If you hold your shares in “street name,” you will receive instructions from your financial institution, broker or other nominee describing how to vote your shares. If you do not instruct your financial institution, broker or other nominee how to vote your shares, they may vote your shares as they decide as to each matter for which they have discretionary authority under the rules of the New York Stock Exchange (the “NYSE”).

There are also non-discretionary matters for which financial institutions, brokers and other nominees do not have discretionary authority to vote unless they receive timely instructions from you. When a financial institution, broker or other nominee does not have discretion to vote on a particular matter and you have not given timely instructions on how the financial institution, broker or other nominee should vote your shares, a “broker non-vote” results. Although any broker non-vote would be counted as present at the meeting for purposes of determining a quorum, it would be treated as not entitled to vote with respect to non-discretionary matters.

If your shares are held in street name and you do not give voting instructions, pursuant to NYSE Rule 452, the record holder will not be permitted to vote your shares with respect to Proposal 1 (Election of the Class I Directors) and Proposal 2 (Advisory Vote to Approve our Named Executive Officer Compensation) and your shares will be considered “broker non-votes” with respect to these proposals. If your shares are held in street name and you do not give voting instructions, the record holder will nevertheless be entitled to vote your shares with respect to Proposal 3 (Ratification of the Appointment of Grant Thornton LLP) in the discretion of the record holder.

Abstentions occur when shareholders are present at our Annual Meeting in person or by proxy but fail to vote or voluntarily withhold their vote for any of the matters upon which the shareholders are voting. Abstentions will have no effect on the election of directors but will have the effect of a vote against the other proposals being considered at the meeting.

What vote is required to approve each proposal?

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Proxy Statement

Who will bear the cost of soliciting votes for our Annual Meeting?

We will bear the entire cost of soliciting proxies, including the cost of the preparation, assembly, uploading to and hosting on the Internet, and printing and mailing of this Proxy Statement, the proxy card and any additional information furnished to our shareholders in connection with our Annual Meeting. In addition to this solicitation by internet or mail, certain directors, officers and employees may also solicit proxies on our behalf by use of mail, telephone, facsimile, electronic means, in person or otherwise. These persons will not receive any additional compensation for assisting in the solicitation but may be reimbursed for reasonable out-of-pocket expenses in connection with the solicitation. We reimburse financial institutions, brokers, custodians, nominees and fiduciaries for their reasonable charges and expenses to forward our proxy materials to the beneficial owners of our Common Stock.

Where can I find the voting results?

We will report the voting results in a Current Report on Form 8-K with the SEC within four business days of our Annual Meeting.

May I propose actions for consideration at next year’s Annual Meeting or nominate individuals to serve as directors?

You may submit proposals for consideration at future annual meetings. See “Shareholder Proposals for the 2025 Annual Meeting” for information regarding the submission of shareholder proposals for next year’s Annual Meeting.

How do I get directions to the Annual Meeting?

For directions to the Annual Meeting, please contact our Corporate Secretary at (713) 332-8400.

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PROXY SUMMARY

WHO WE ARE

Carriage was founded on the shared values of honesty, integrity, and a belief in the power of people. This foundation unites us in our new purpose statement: “Creating a premier experience through innovation, empowered partnership, and elevated service.” We are a consolidator and provider of funeral and cemetery services and merchandise in the United States, operating funeral homes and cemeteries nationwide. Our Common Stock is publicly traded on the NYSE, under the symbol CSV.

PROPOSAL NO. 1:

ELECTION OF CLASS I DIRECTORS

We currently have seven directors on our Board who each serve staggered three-year terms. At our Annual Meeting, the shareholders will elect two individuals to serve as our Class I Directors for a new three-year term expiring on the date of our 2027 Annual Meeting and until their successors are duly elected and qualified. This classification of our Board may have the effect of delaying or preventing changes in control of our Company.

Our Corporate Governance Committee has recommended that we nominate Julie Sanders and Somer Webb for election at our Annual Meeting to serve as our Class I Directors for new three-year terms. Proxies may be voted for each of the Class I Directors. The biographical description for Ms. Sanders and Ms. Webb are included below.

As a result of the feedback we collected from our shareholders, the Company’s Board announced in 2023 that it would be focused on enhancing governance, including identifying new Board members with diverse skills, experiences, expertise, age, gender and backgrounds to align with the Company’s strategic vision. On June 15, 2023, Dr. Achille Messac resigned as a member of the Board, as a Class II director. On June 21, 2023, upon the recommendation of our Corporate Governance Committee, the Board elected Chad Fargason to serve as a Class II director until the Company’s 2025 Annual Meeting. Additionally, on that same day, the Board elected Melvin C. Payne to serve as Executive Chairman of the Board. On July 5, 2023, upon the recommendation of our Corporate Governance Committee, the Board elected Somer Webb to serve as a Class I director until the Company’s 2024 Annual Meeting. On July 24, 2023, Barry K. Fingerhut resigned as a member of the Board, as a Class I director. On July 25, 2023, upon the recommendation of our Corporate Governance Committee, the Board elected Julie Sanders to serve as a Class II director until the Company’s 2025 Annual Meeting.

On February 22, 2024, Mr. Payne, the Company’s founder and former CEO, stepped down as Executive Chairman of the Board and transitioned to serving as special advisor to the Board. In connection with stepping down as Executive Chairman, Mr. Payne, who is currently a Class I director, will remain on the Board until our 2024 Annual Meeting, when the term for Class I directors is scheduled to expire. On March 7, 2024, upon the recommendation of our Corporate Governance Committee, the Board elected Mr. Fargason to serve as the Company’s first ever Non-Executive Chairman of the Board.

On March 7, 2024, upon the recommendation of our Corporate Governance Committee, the Board realigned the Company’s classes of directors to provide for equal apportionment among the three classes, as contemplated by the Company’s Amended and Restated Certificate of Incorporation, as a result of Mr. Payne not seeking election to another term as a Class I director. To facilitate the class realignment, on March 7, 2024, Ms. Sanders resigned from the Board as a Class II director, and, effective March 7, 2024, was re-elected by the Board to serve as a Class I director until the Company’s 2024 Annual Meeting.

Directors are elected by a majority of votes cast. Our bylaws, which were amended and restated during 2023 in connection with our focus on governance and responsiveness to shareholder feedback, provide that in an uncontested election, if the nominee director does not receive a majority of the votes cast, the nominee must promptly deliver a written resignation to our Board, which shall be immediately accepted and the directorship will become vacant and the Board may either fill the vacancy by a majority vote or decrease the size of our Board. In the event of a contested election of directors, our bylaws provide that directors will be elected by the vote of a plurality of the votes of the shares present in person or represented by proxy and entitled to vote in the election of directors.

2024 Proxy Statement  7

Proposal No. 1 Election of Class I Directors

Skills and Qualifications
Industry Experience
Senior Leadership Experience
Risk Oversight and Management Experience
Operations Experience
Regulatory Experience
Finance / Accounting

Our Board believes that each of our directors is highly qualified to serve as a member of our Board. In particular, our Board seeks individuals who demonstrate:

Described below are the principal occupations, positions and directorships for at least the past five years of our director nominees and continuing directors, as well as certain information regarding their individual experience, qualifications, attributes and skills that led our Board to conclude that they should serve on our Board. There are no family relationships among any of our directors or executive officers.

8  Carriage Services

Proposal No. 1 Election of Class I Directors

Nominees for Director

You may not cumulate your votes in the election of the Class I Director nominees. You may withhold authority to vote for the nominee for director. If a nominee becomes unable to serve as a director before our Annual Meeting (or decides not to serve), the individuals named as proxies will vote, in accordance with instructions provided, for such other nominee as we may designate as a replacement or substitute, or our Board may reduce the size of the Board to eliminate the vacancy.

BOARD RECOMMENDATION

2024 Proxy Statement  9

Proposal No. 1 Election of Class I Directors

Continuing Directors

10  Carriage Services

Proposal No. 1 Election of Class I Directors

2024 Proxy Statement  11

Proposal No. 1 Election of Class I Directors

12  Carriage Services

BOARD LEADERSHIP & CORPORATE GOVERNANCE

2023: Shareholder Feedback and Prioritizing Corporate Governance

Since Carriage’s 2023 Annual Meeting of Shareholders, we have made a number of significant changes to support our focus on corporate governance, including:

2023 was a year during which Carriage sought feedback from many of our shareholders and prioritized the evolution of our corporate governance framework. Since a thoughtful approach to governance begins with the individuals serving on the Board, Carriage partnered with a third-party executive search firm and recruited three new independent directors to help drive this focus. Concurrent with the addition of three new directors in 2023, two incumbent directors resigned from the Board.

Each of these three new directors brings a diverse skill set, deep experience, and a fresh perspective that directly aligns with Carriage’s long-term growth strategy, with a particular emphasis on financial acumen, capital allocation experience, and valuation expertise. Two of the three directors, Julie Sanders and Somer Webb, have been nominated by the Board this year to serve three-year terms as Class I directors. The third recently added director, Chad Fargason, was elected by the Board in March of this year to serve as the Company’s first ever Non-Executive Chairman of the Board.

In addition to listening to, and acting upon, the feedback from our shareholders regarding greater diversity on our Board, we also amended our bylaws to ensure that only directors who receive a majority of the votes cast in an uncontested election, will serve on our Board moving forward.

2024: Maintaining the Focus on Feedback and Improvement

As will be discussed in greater detail in the “Compensation Discussion and Analysis” section of this Proxy Statement, the Board and Executive Management team are committed to building upon the momentum demonstrated in 2023. Among the focuses in 2024:

2024 Proxy Statement  13

Corporate Governance

Risk Oversight of the Board

We believe that the oversight function of our Board and its committees, combined with active dialogue with management about effective risk management relative to continuously assessing for the right quality of staff at all levels, provides our Company with the appropriate framework to help ensure effective risk oversight.

Additionally, a significant amount of time is spent by our Board and committees, in partnership with management, discussing how we identify, assess and manage our most significant risk exposures with respect to our Company, leadership and people. For example, our Audit Committee routinely meets with our internal audit and external audit teams and the Board is involved in regular discussions during operational and strategic reviews with the Company’s Executive Management team, as well as discussions surrounding the programs, policies, processes and controls related to the Company’s financial activities and performance; controllership and financial reporting; executive officer development and evaluation; compliance with the Company’s Code of Business Conduct and Ethics; applicable laws and regulations; information technology; and internal audits. Our Board also relies on each of its committees to help administer its oversight duties for those areas which they have oversight responsibilities. For example, on February 22, 2023, our Board adopted revisions to the Company’s Code of Business Conduct and Ethics based on recommendations from the Audit Committee following its periodic review, which included, among other things, clarifying existing compliance requirements and expanding certain policies, including those related to bribery and kickbacks, antitrust, political activity and improper influence on auditors, all of which are reasonably designed to support the Company’s compliance with applicable rules and regulations and mitigate related compliance risks.

Director Qualification, Experience and Tenure

Our Corporate Governance Committee is responsible for reviewing the requisite skills and characteristics of new Board members as well as the composition of our Board, with significant input from our Executive Management team. It is the position of our Corporate Governance Committee that, as a company of our size in the specialized field of the funeral and cemetery industry, it is important for our directors to understand, support and align with our culture.

While it is difficult to define what the perfect director candidate looks like for Carriage, we believe diversity of all kinds, including, but not limited to, experience, age, gender, ethnic background, skills, perspective and background are important contributing factors to effective decision-making. Thus, the Corporate Governance Committee believes it is in the best interest of Carriage to identify the best candidates for its board, cognizant of diversity in all forms and will continue to find ways to ensure that it is doing so.

For Carriage, diversity of all kinds, including, but not limited to, experience, age, gender, ethnic background, skills, perspective and background are important contributing factors to effective decision-making. Thus, the Corporate Governance Committee believes it is in the best interest of Carriage to identify the best candidates for its board, cognizant of diversity in all forms, and will continue to find ways to ensure that it is doing so.

None of our directors serve on any other public company boards and we prefer candidates who are focused on helping Carriage achieve our long-term growth objectives, rather than serving on numerous public company boards. We currently have no established term limits or age restrictions, as we do not wish to risk losing the contribution of directors who have been able to develop historical insight and a deep understanding of our unique industry and operating model.

We currently have seven directors on our Board who each serve staggered three-year terms. Five directors are independent. The average age of all directors currently serving on our Board is 59 years. The average age of all independent directors is 56 years. The average tenure of all independent directors is 4.2 years.

14  Carriage Services

Corporate Governance

Director Nomination Process

Our Corporate Governance Committee, with assistance from internal and external resources as the Corporate Governance Committee desires, identifies potential candidates for our Board based upon the criteria set forth above. Once a potential candidate is identified and the individual expresses a willingness to be considered for election to our Board, our Corporate Governance Committee and Mr. Fargason will request information from the candidate, review the individual’s qualifications, and conduct one or more interviews with the candidate. When this process is complete, our Corporate Governance Committee tenders its recommendation to our full Board for consideration.

Our Corporate Governance Committee will also consider candidates recommended by shareholders in the same manner. A stockholder may recommend nominees for director by giving our Corporate Secretary a written notice not less than 90 days prior to the anniversary date of the immediately preceding Annual Meeting. For our 2025 Annual Meeting of Shareholders, the deadline will be February 13, 2025, based upon this year’s meeting occurring on May 14, 2024. The notice must include, amongst other things, the name and address of the stockholder giving notice and the number of shares of Common Stock beneficially owned by the stockholder, as well as the nominee’s full name, age, business address, principal occupation or employment, the number of shares of Common Stock that the nominee beneficially owns, any other information about the nominee that must be disclosed in proxy solicitations under Regulation 14A of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the nominee’s written consent to the nomination and to serve, if elected.

Organization and Committees of Our Board

All members of the Board are strongly encouraged to attend each meeting of the Board and meetings of the Board committees on which they serve, as well as our Annual Meeting. Due to the Board’s review of strategic alternatives last year, our Board held eighteen (18) regularly scheduled meetings and acted by unanimous written consent eight (8) additional times during the calendar year 2023. During this period each of our then current Board members attended all of the meetings of our Board, except for Mr. Payne who was unable to attend the meeting held on February 22, 2023, along with Mr. Fingerhut being unable to attend the meeting held on July 5, 2023. In addition, each year we hold the Annual Meeting on the same day as our Board and committee meetings such that all directors may attend the Annual Meeting. All of our then current directors attended the 2023 Annual Meeting of Stockholders.

Our Board has a Compensation, Audit and Corporate Governance Committee. The current members of each committee as of the Record Date are identified in the table below. Each of these committees has its own charter, and a copy of the current version is available on our website at www.carriageservices.com. The functions of each committee and the number of meetings held during 2023 are described below.

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Corporate Governance

Compensation Committee

Our Compensation Committee’s principal functions and responsibilities are to:

Generally, our Board has charged our Compensation Committee with the overall responsibility for establishing, implementing and monitoring the compensation for our executive officers and senior leadership team. Executive compensation matters are presented to the Compensation Committee in a variety of ways, including: (1) at the request of our Compensation Committee Chair or two or more members of the Compensation Committee or two members of our Board, (2) in accordance with our Compensation Committee’s agenda, which is reviewed by our Compensation Committee members and other directors on an annual basis, (3) by our CEO or (4) by our Compensation Committee’s outside compensation consultant.

To the extent permitted by applicable law, our Compensation Committee may delegate some or all of its authority under its charter to its chair, any one of its members, or any subcommittees it may form when it deems such action appropriate. Mr. Quezada, as our CEO, makes recommendations on compensation decisions for those other than himself based on the individual performance of each executive officer or senior leader and the Company’s overall performance. Management’s role in determining executive compensation includes:

Our Compensation Committee makes all final decisions regarding executive officer compensation.

Our Compensation Committee held three (3) regularly scheduled meetings during 2023 and acted by unanimous written consent one (1) additional time. Each of our then current members of the Compensation Committee was present at all meetings. Our Board has determined that all members of the committee are independent under the listing standards of the NYSE and the rules of the SEC. Each of the members of the committee is considered to be a “non-employee director” under Rule 16b-3 of the Exchange Act, and an “outside director” under Section 162(m) of the Internal Revenue Code of 1986, as amended.

16  Carriage Services

Corporate Governance

Audit Committee

Our Audit Committee’s principal functions and responsibilities are to:

In connection with these purposes, our Audit Committee annually selects, engages and evaluates the performance and ongoing qualifications of, and determines the compensation for, our independent registered public accounting firm and confirms its independence. The Audit Committee also reviews our annual and quarterly financial statements and meets with our Executive Management team and independent registered public accounting firm regarding the adequacy of our financial controls and our compliance with legal, tax and regulatory matters and significant internal policies.

Our Audit Committee held five (5) regularly scheduled meetings during 2023 and did not act by unanimous written consent. Each of our then current members of the Audit Committee was present at all meetings. All members of our Audit Committee are independent as defined in the NYSE’s listing standards and by Rule 10A-3 promulgated under the Exchange Act. Our Board has determined that each member of our Audit Committee is financially literate and that Mr. Patteson has the necessary accounting and financial expertise to serve as Chair. Our Board has also determined that Mr. Patteson and Mses. Sanders and Webb are “audit committee financial experts” following a determination that they each met the criteria for such designation under the SEC’s rules and regulations. See the “Audit Committee Report” on page 58 for additional information regarding our Audit Committee.

Corporate Governance Committee.

Our Corporate Governance Committee’s principal functions and responsibilities are to:

Our Corporate Governance Committee held five (5) regularly scheduled meetings during 2023 and did not act by unanimous written consent. Each of our then current members of the Corporate Governance Committee was present at all meetings, except for Mr. Fingerhut who was unable to attend the meeting held on July 5, 2023.

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Corporate Governance

Director Independence

In accordance with applicable laws, regulations, our Corporate Governance Guidelines, and the rules of the NYSE, our Board must affirmatively determine the independence of each director and director nominee. Accordingly, our Board determined that Mses. Sanders and Webb and Messrs. Fargason, Meehan, and Patteson do not have a material relationship with Carriage (either directly or as a partner, stockholder or officer of an organization that has a material relationship with Carriage) and are “independent” as defined under the NYSE’s listing standards and by the SEC under Item 407(a) of Regulation S-K.

Neither Mr. Payne nor Mr. Quezada is independent because Mr. Quezada is an employee of Carriage and currently serves as our CEO, and Mr. Payne was an employee of Carriage until February 22, 2024.

Board’s Interaction with Shareholders

Our CEO and Executive Management team are responsible for establishing effective communication with our shareholders. Independent directors are not precluded from meeting with shareholders, but where appropriate, our CEO or other members of our Executive Management Team should be present at such meetings.

Shareholders and other interested parties may contact any member of our Board or any of its committees by addressing any correspondence in care of Carriage Services, Inc., 3040 Post Oak Boulevard, Suite 300, Houston, Texas 77056; Attn: Corporate Secretary. In the case of communications addressed to the independent directors, our Corporate Secretary will send appropriate shareholder communications to the Chairman. In the case of communications addressed to a committee of our Board, our Corporate Secretary will send appropriate shareholder communications to the Chairman of such committee.

Annual Evaluations

In accordance with our Corporate Governance Guidelines, our Board members perform annual self-evaluations. These self-evaluations are conducted through written questionnaires circulated, typically in January prior to the first regularly scheduled meeting of the Board. At the first regularly scheduled Board meeting before the Annual Meeting of Shareholders, detailed results of the self-evaluations are provided to the Corporate Governance Committee Chairman and discussed at the Board meeting.

Corporate Governance Guidelines, Business Conduct and Ethics

Our Company is committed to integrity, reliability and transparency in our disclosures to the public. To evidence this commitment, our Board has adopted charters for its committees, Corporate Governance Guidelines, and a Code of Business Conduct and Ethics. These documents, in addition to our bylaws, provide the framework for our corporate governance.

A complete copy of the current version of each of these documents is accessible through our website at www.carriageservices.com or you may receive copies free of charge by writing to us at Carriage Services, Inc., 3040 Post Oak Boulevard, Suite 300, Houston, Texas 77056, Attn: Corporate Secretary.

Compensation Committee Interlocks and Insider Participation

During 2023, Mses. Sanders and Webb and Messrs. Fargason, Meehan, and Patteson served on our Compensation Committee. None of Mses. Sanders and Webb and Messrs. Fargason, Meehan, and Patteson at any time have been an officer or employee of our Company, nor had any substantial business dealings with us that would require disclosure in accordance with our Related Party Transactions Review Policy. Prior to their resignations from the Board on June 15, 2023 and July 25, 2023 respectively, Dr. Achille Messac and Barry Fingerhut also served on our Compensation Committee and neither had been an officer or employee of our Company nor had any substantial business dealings with us that would require disclosure in accordance with our Related Party Transactions Review Policy.

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Corporate Governance

None of our Named Executive Officers serve as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as a member of our Board or our Compensation Committee.

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Carriage Culture

Driving Positive Social and Environmental Impacts

Our Commitment to an Empowered and Enduring

Company, Culture, and Partnership with our Communities

At Carriage, we focus on empowering people to make thoughtful and broadly meaningful decisions throughout our Company and within our community. Our focus when it comes to building and continuously developing a company and culture of empowered leaders has been, and always will be, people.

Social Impact

Investment in People

Everything begins with our employees. We empower our team to make decisions that will have a positive and lasting impact, not only on the client families who we are privileged to serve, but also within our communities, ultimately resulting in long-term value for our shareholders. In order to equip, position and motivate our employees to make these important, and often local decisions, we are intentional in creating a culture driven by education, awareness, and resources. We have written extensively over the years about our unique culture and encourage our shareholders to review prior releases for greater insight.

In combination with this focus on culture, we also invest holistically in our employees, from education and development (e.g. health and safety training, tuition reimbursement programs, etc.) to financial wellness (e.g. an employee stock purchase plan, 401k Plan with a company match, etc.) to an overall focus on physical and mental well-being (free biometric screenings resulting in discounts on health insurance, discounts on gym memberships, an employee assistance program, etc.). We have an internal “Wellness Committee” which is comprised of a number of Carriage employees who have a passion for, and are focused on, continuing to build upon a program of enhanced and broad wellness opportunities for our approximately 2,600 employees.

People Driven Purpose

Our focus on people and culture begins with our employees, who then lead the service provided to our client families along with our partnership with the numerous communities of which we are a part. As it relates to our focus on partnership with our client families and our communities, our businesses are intimately involved with their respective communities at a local level. We encourage any shareholder who would like to learn more about the unique relationships between our businesses and their local communities to reach out to one of our Managing Partners.

At a broader level of support and engagement, “Carriage Cares” is our 501(c)(3) non-profit organization which is overseen by a committee of employees. While currently entirely funded by our employees, Carriage Cares was initially established years ago to support fellow employees who were adversely impacted by natural disasters. The purpose and reach of Carriage Cares has since grown through the passion of its committee members who have worked together to expand our fundraising focus in an effort to identify opportunities within the various communities across the country for our businesses to give back, not only with financial contributions to support local charitable causes, but also through “roll up our sleeves” volunteer opportunities. During 2023, Carriage Cares’ community initiatives included support for the Stocking Project by Mrs. Claus, the Boys and Girls Clubs of Greater Houston, and the Mission of Yahweh. Carriage Cares also received over $30,000 in donations from our employees during 2023, reflecting our employees’ sincere generosity and support for the Carriage Cares mission. We are extremely proud of our Carriage Cares team, their employee-led projects and the generosity of our employees, all of which reflects our “People Driven Purpose” culture.

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Carriage Culture

Diverse Leadership

As it relates to our focus on people, we also believe diversity is a key component to our success and can be found in a number of areas, including thought, gender, race, ethnicity, age and life experience, among many other areas. Diversity, in all senses of the word, continues to expand within Carriage. For example, within our decentralized owner/operator model, our entrepreneurial Managing Partners who lead our businesses, are our most critical leaders. Over the course of the past several years, we have seen the number of women serving in our Managing Partner roles steadily increase each year. More specifically, the number of women leading our businesses has more than doubled during this short time. For 2023, we continued this trend and we now have thirty-nine (39) women serving as Managing Partners for our businesses. Notably, many of our top producing Sales Managers are women and two of the three most recent additions to our Senior Leadership team, and the two most recent additions to our Board, are women.

Among our Support Center team of 124 employees, as of December 31, 2023, forty-seven percent (47%) are women and sixty-five percent (65%) are racial or ethnic minorities.

It is important to note that none of these numbers are driven by a standardized approach to diversity. These figures are entirely organic and the result of a culture where we will always seek out the very best talent, regardless of gender, race or age. We will continue to focus on recruiting the very best talent which, in our experience, naturally leads to a broadly diverse team.

With that said, it is our thought diversity of which we are most proud and focused. From our businesses to our Support Center, we encourage our employees to be independent thinkers and drive thoughtful

2024 Proxy Statement  21

Carriage Culture

decision-making supported by both data and creativity. We do not subscribe to a “playbook” approach that should be followed by every business, but rather an encouragement to know your employees, customers, and your community and then build a customized approach that best serves those unique stakeholders. One size most certainly does not fit all at Carriage.

The Right Who’s Making the Right Decisions

We believe that when you empower people to make decisions and provide them with resources, you will see positive and lasting results occur organically. For example, as it relates to environmental matters, as our businesses are updated or remodeled, or where we expand our business, we empower our Managing Partners to use energy-efficient lighting, heating, and cooling at their businesses. Managing Partners also have the autonomy to add electric vehicles to their fleets or implement other programs that demonstrate our commitment to operating our businesses in a sustainable manner. A perfect example of this empowerment includes our Las Vegas, NV businesses’ “Memories Taking Root” program offered to the families we serve in that community. On behalf of each family we serve at those businesses, we make a donation to the U.S. Forest Service’s Plant-A-Tree program, with tree seedlings planted in our National Forests. To date, we have made donations to the Plant-A-Tree program that supports planting approximately 880 trees in our National Forests. We are grateful to offer our families in Las Vegas, NV this positive way to commemorate loved ones while creating a beneficial and lasting impact on our environment, a program we may consider expanding in the future to more of our businesses across the country.

Additionally, we partner with and support our Managing Partners and the businesses they lead from our Support Center, which occupies approximately 48,000 square feet of leased office space in Houston, Texas. The home of our Support Center has obtained a LEED Silver Certification, an ENERGY STAR Certified score of 94 and was a MetLife ESG Challenge Award Winner in 2020.

We believe our decentralized approach to operating our businesses leads to not only growth in local markets, but shows our commitment to being good community and environmental partners, along with demonstrating the difference our people and businesses can make in the communities they serve, environmental or otherwise, particularly when they are empowered to lead and customize these local approaches.

Experienced Leadership & Continuous Education, Growth, and Improvement

Leading this “First Who, Then What” approach to culture and decision-making, is our purpose-built Executive Management team and Board, who each bring a unique background and set of skills that help drive the Company’s current focus on continuous improvement in all areas, including governance and social and environmental responsibilities. We are committed to seeking feedback from our various stakeholders and finding ways to continuously improve based on these conversations. While we made

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Carriage Culture

significant progress in 2023, as detailed in this Proxy Statement, we have much more opportunity in front of us and look forward to reporting our continued improvement in the years ahead.

As part of our Board’s strategic and risk oversight, the Board continually assesses whether changes to our corporate governance policies and practices are appropriate with regular reviews and updates to not only those policies, but also to our by-laws and committee charters. Our Board is also encouraged to continuously learn and grow through various avenues, including customized questionnaires and discussions surrounding key hypotheticals involving the Company’s future, invitations to attend our regular operations leadership calls to learn more about what is driving performance, as well as educational opportunities both presented during Board and Committee meetings, as well as support to gain additional education outside of meetings.

We encourage our shareholders to take the time to learn more about the unique background of each individual member of the Company’s Executive Management team and Board to better understand these individuals, their stories, and the impact he or she has had on Carriage’s unique culture.

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DIRECTOR COMPENSATION

General

We compensate our non-employee directors through cash payments or unrestricted shares of Common Stock, as elected by the Board member, including retainers. Our Director Compensation Policy provides the following:

Our Director Compensation Policy provides the option for any director to elect to receive their annual retainer, which is paid in quarterly installments, in unrestricted shares of our Common Stock by providing to us written notice. The number of shares of such Common Stock shall be determined by dividing the cash amount of the retainer by the closing price of our Common Stock on the date of grant, which shall be the last business day of each quarter. Such Common Stock shall vest immediately upon grant. Any written notice to receive the retainer in Common Stock shall remain in effect until notice otherwise is made in writing.

Our Director Compensation Policy also provides that any new independent director will receive a grant of $25,000 (in addition to the independent director annual retainer prorated at the time the new director is admitted to the Board) upon appointment or election to the Board, which can be taken in cash or unrestricted shares of our Common Stock. The number of shares of such Common Stock will be determined by dividing the cash amount by the closing price of our Common Stock on the date of grant, which will be the date of admission to the Board. Pursuant to our Director Compensation Policy any such new director grant shall vest immediately.

Our Director Compensation Policy further provides that our employee directors are not separately compensated for their service as directors.

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Director Compensation

Director Compensation Table

The following table sets forth a summary of the compensation we paid to our non-employee directors in 2023:

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Director Compensation

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SECURITY OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS, AND CERTAIN BENEFICIAL OWNERS

Stock Ownership of Management

The following table sets forth, as of March 15, 2024, the number of shares beneficially owned and the percentage of the Common Stock held by: (1) each of our directors and director nominees, (2) our Principal Executive Officer and Principal Financial Officer, (3) our other executive officers named in the Summary Compensation Table set forth under “Executive Compensation,” and (4) all our current executive officers and directors as a group. Under the rules of the SEC, on any day, a person is deemed to own beneficially all securities as to which that person owns or shares voting or investment power, as well as all securities which such person may acquire within 60 days of such date through the exercise of currently available conversion rights or options. Except as otherwise stated in the notes to the table, each person named in the table below has sole voting and investment power with respect to the shares indicated.

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Security Ownership of Directors, Executive Officers and Certain Beneficial Owners

Stock Ownership of Certain Beneficial Owners

As of March 15, 2024, the persons named below were, to our knowledge, the only beneficial owners of more than 5% of our outstanding Common Stock, determined in accordance with Rule 13d-3 of the Exchange Act, other than directors and executive officers whose beneficial ownership is described in the previous table.

Delinquent Section 16(a) Reports

Section 16(a) of the Exchange Act requires our executive officers and directors, and persons who own more than 10% of a registered class of our equity securities, to file with the SEC and the NYSE reports of ownership and changes in ownership of Common Stock and other of our equity securities on Forms 3, 4, and 5, and to furnish us with copies of all Forms 3, 4, and 5 they file.

The Company believes, based solely on our review of the copies of such forms and written representations from reporting persons, that all filings required to be made under Section 16(a) of the Exchange Act were timely made for the fiscal year ended December 31, 2023.

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COMPENSATION COMMITTEE REPORT

The Compensation Committee of the Board of Directors (the “Compensation Committee”) of Carriage Services, Inc. (“Carriage”) has reviewed and discussed Carriage’s Compensation Discussion and Analysis with Carriage management. Based on such review and discussions, the Compensation Committee has recommended to the Board of Directors of Carriage that the Compensation Discussion and Analysis be included in this Proxy Statement and incorporated by reference into the Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Compensation Committee

Somer Webb, Chair

Chad Fargason

Douglas B. Meehan

Donald D. Patteson, Jr.

Julie Sanders

March 29, 2024

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EXECUTIVE MANAGEMENT

The following table sets forth the name, age and title of our Executive Officers as of the date of this Proxy Statement. Our Executive Officers serve at the discretion of our Board. There are no family relationships between any of our directors and our Executive Officers. In addition, there are no arrangements or understandings between any of our Executive Officers and any other person pursuant to which any person was selected as an executive officer.

The Executive Officers of the Company are as follows:

The biographical information for Mr. Quezada is located under “Proposal No. 1: Election of Class I Directors – Continuing Directors.”

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EXECUTIVE MANAGEMENT

2024 Proxy Statement  31

COMPENSATION DISCUSSION AND ANALYSIS

The following Compensation Discussion and Analysis describes in detail the compensation paid to our Named Executive Officers (“NEOs”) listed in the Summary Compensation Table. This section is designed to provide our shareholders with insight into, and an understanding of, our compensation programs and practices, along with the decision-making process as it relates to the compensation of our NEOs.

For 2023, our NEOs were:

Enhanced Focus on Compensation in 2024

In connection with many of the governance related improvements that occurred in 2023, our Compensation Committee elected Somer Webb to serve as its new Chair, and she has already taken steps to continue the progress achieved in 2023. Earlier this year, the Committee engaged third-party executive compensation consultant, Pearl Meyer, to advise the Compensation Committee and develop a peer group for the Company. That peer group was then used by Pearl Meyer to provide an evaluation of all aspects of compensation for the Company’s NEOs. Pearl Meyer did not recommend any changes to the current compensation of the NEOs following their evaluation and peer group comparison.

In connection with Pearl Meyer’s review, the Compensation Committee is also finalizing new short-term and long-term incentive compensation plans which will be based entirely on key financial metrics tied to Company performance and creating shareholder value.

Additionally, the Compensation Committee is also finalizing new stock ownership guidelines for both the Executive Management team and Directors. This holistic approach to continuously improving how the Company approaches compensation, is consistent with feedback the Company received from its shareholders following last year’s Annual Meeting. Carriage and its Compensation Committee are committed to continuing to build a compensation approach that is both transparent and aligned with creating shareholder value.

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Compensation Discussion and Analysis

Compensation Philosophy and Practices

Carriage’s executive compensation programs align our executive pay with the Company’s operational and financial performance, as well as support our short-term and long-term business objectives. The Compensation Committee consists entirely of independent Board members and is responsible for the approval and oversight of compensation and employment agreements affecting Carriage’s NEOs.

During 2023, the Compensation Committee elected a new Chair, Somer Webb, and continued to implement an executive compensation philosophy (the “Philosophy”), which focuses on Company performance and individual leadership and contributions. The Philosophy may be summarized in this manner:

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Compensation Discussion and Analysis

We regularly engage with shareholders on all matters regarding the Company’s results, operations, leadership and culture including other topics such as executive compensation, retention and succession planning. Mr. Granmayeh leads our investor relations function engaging in various investor meetings throughout the year, with significant involvement from Messrs. Quezada and Metzger. Our ongoing outreach program allows the Executive Management team the opportunity to continually address any questions regarding our compensation philosophy and alignment with the interests of our shareholders.

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Compensation Discussion and Analysis

Consideration of Previous Shareholder Advisory Vote

The Compensation Committee also considers the outcome of the Company’s advisory shareholder vote on our NEO compensation program and any associated shareholder outreach efforts when making compensation decisions. At our 2023 Annual Meeting of Shareholders, our shareholders expressed less support for the Company’s proposal to ratify our NEO compensation program than what the Company is used to seeing. This decline in support caused the Company to take action in the form of recruiting new Board members, naming a new Chair for the Compensation Committee, and engaging a third-party executive compensation consultant to advise the Compensation Committee. The majority of the feedback the Company received regarding the decline in support, was related to implementing specific financial metrics for short-term and long-term incentive compensation plans. The Compensation Committee is currently in the process of finalizing those plan designs, with the assistance of Pearl Meyer.

While the shareholder vote to ratify our executive compensation is non-binding and advisory, we will continue to strive to understand and respond to shareholder feedback.

Elements of Compensation

Each element of our executive compensation program for NEOs has been designed to align with our Philosophy and our goal of growing the intrinsic value of Carriage per share for our long-term stockholders through disciplined and consistent high-level execution of our three core models (Standards Operating, Strategic Acquisition and 4E Leadership).

The Compensation Committee currently uses internal data to determine the compensation for most executive leadership positions. Due to the uniqueness of our industry and the size of our Company within the industry, executive officer compensation may be difficult to benchmark against market data. We do have insight into compensation philosophy and structures of main competitors within our industry as well as public companies with similar revenue and EBITDA profiles to remain competitive and retain top talent. We recently engaged Pearl Meyer who helped the Compensation Committee identify a peer group and then evaluated our NEOs compensation in comparison to the newly created peer group. Following their evaluation, Pearl Meyer did not recommend any changes to our NEOs base salaries or short-term or long-term incentive targets.

The allocation between cash and equity compensation and between short-term and long-term incentives, is determined based on the discretion of the Compensation Committee. The ultimate allocation will depend on our future company and individual performance and potentially future changes in our share price. If vesting targets are achieved, it is likely that a substantial percentage of the amount realized will be from long-term, equity-based incentives, which is consistent with our Philosophy and our commitment to long-term value creation for our shareholders. We believe the elements of our compensation structure create incentives for the executives to take actions and make decisions that will benefit Carriage over the long-term and create long-term value for our shareholders. In partnership with Pearl Meyer, the Compensation Committee is in the process of designing new financial metrics based short-term and long-term incentive plans for our Executive Management team.

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Compensation Discussion and Analysis

Compensation designed for our executive officers consists of:

We regularly review how our levels of compensation align with performance and how our mix of pay (base salary versus annual cash incentives and long-term incentives) will allow us to attract and retain executive level leaders, while motivating these leaders to execute upon both annual and long-term goals.

Employment Agreements

All of our NEOs who are currently employed by the Company, have employment agreements with the Company (the “Agreements”). Each of these Agreements are for terms of three years. These Agreements obligate the Company to make certain payments and provide certain benefits to the Company’s executive officers upon a qualifying termination of employment as defined within the Agreements. Pursuant to the Agreements, the executive officers agreed to certain non-competition provisions and other restrictive covenants during the term of his or her employment and for a period of time thereafter. The Agreements supersede any prior agreements entered into by the Company and any of the executive officers. The Agreements for all of the executive officers are identical, except as noted herein.

The Agreements establish, among other things, (a) a minimum base salary, (b) minimum target bonus amounts (expressed as a percentage of base salary), and (c) post-termination payments due in certain scenarios. For a description of the post-termination benefits provided for in the Agreements see the “Potential Payments Upon Termination” section as further discussed herein.

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Compensation Discussion and Analysis

Compensation Evaluation Process

Our Compensation Committee has final approval regarding recommendations of executive officer compensation. Mr. Quezada’s role as our CEO in determining executive compensation is to make compensation recommendations to the Compensation Committee based on his assessment of the individual performance of each executive officer in relation to our overall Company performance. Management’s role in determining executive compensation includes:

Given our unique organizational culture and the particular sector in which we belong, there are few direct, public company peers. We will review market compensation and direct peer group data in connection with our internal review of the roles and responsibilities of each of our executive positions in order to determine competitive pay levels for each executive officer of the Company, including our NEOs.

During 2023, the Compensation Committee did not engage an independent, third party compensation consultant or use peer group data. Instead, our Executive Management team worked with the Compensation Committee on a compensation program that is aligned, with and tailored to, the uniqueness of our industry, while also taking into account publicly available data of named executive officers of other public companies with similar revenue and EBITDA profiles. However, as discussed in further detail above, the Compensation committee has engaged a compensation consultant in 2024 to assist with the Committee’s current focus described above.

CEO Compensation

Mr. Payne’s average annual total compensation was $4.6 million over the last five years, which reflects compensation paid to Mr. Payne in his prior role of CEO and Executive Chairman, and $2.4 million over the last three years for Mr. Quezada, which reflects compensation paid to Mr. Quezada in his prior non-CEO roles, as a result of each partially serving in the role of CEO during the year ended December 31, 2023. The Compensation Committee believes that this compensation and any additional realized compensation from the increase in equity value, is commensurate with the high level of operating and financial performance by Carriage.

The charts below depict the 2023 mix of total direct compensation (base salary, cash incentive bonus and long-term equity-based incentives) for Mr. Payne, our former CEO and Executive Chairman, and our other NEOs as a whole, and for Mr. Quezada, our current CEO and Vice Chairman, and our other NEOs as a whole. The long-term equity-based incentives are composed of restricted stock awards, which were valued at the stock price on the grant date of $32.69 and stock options, which were valued at $11.70 per share calculated using the Black-Scholes pricing method (refer to “Long-Term Equity-Based Incentives” on page 40 for additional details).

A portion of the 2023 compensation of our NEOs is considered at-risk and is directly affected by our financial results and stock price, both in the amount of total cash compensation earned and the value of outstanding long-term equity awards. As such, 75% of Mr. Payne’s total direct compensation and, on average, 69% of our other NEOs’ total direct compensation, is variable and directly affected by both the Company’s and each NEOs’ performance.

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Compensation Discussion and Analysis

Additionally, 75% of Mr. Quezada’s total direct compensation and, on average 66% of our other NEOs total direct compensation, is variable and directly affected by both the Company’s and each NEOs’ performance.

Base Salaries

The base salary for each of our NEOs is determined on an individual basis, taking into account such factors as the duties, experience and levels of responsibility of each executive. Base salaries for our NEOs, are evaluated annually and adjustments are approved by our Compensation Committee based on its evaluation of individual performance.

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Compensation Discussion and Analysis

Our Compensation Committee approved the following annual base salaries of our NEOs for 2023:

Annual Cash Incentive Bonuses

Melvin C. Payne, CEO; Carlos R. Quezada, CEO

The 2023 cash incentive bonus of $1,250,000 for both Mr. Payne and Mr. Quezada was determined at the Compensation Committee meeting held in February 2024 and was made at the discretion of the Compensation Committee for the following reasons, but not limited to:

Other Named Executive Officers

The 2023 cash incentive bonuses for Messrs. Metzger, Granmayeh, Elliott and Phillips and Ms. Olaniyan were determined at the Compensation Committee meeting held in February 2024 and were based upon previously established bonus targets as a percentage of base salary in addition to individual contributions, responsibilities, and Company financial and operational performance results during 2023.

2024 Proxy Statement  39

Compensation Discussion and Analysis

The table below sets forth the 2023 base salary, the incentive bonus targets and the actual incentive bonus payments, as a percentage of base salary, for Messrs. Metzger, Granmayeh, Elliott and Phillips and Ms. Olaniyan. As a result of Mr. Brink’s resignation, he was not awarded a cash incentive bonus. As it relates to Mr. Metzger’s cash incentive bonus for 2023, the Compensation Committee took into consideration the significant time and leadership required in connection with the Company’s review of strategic alternatives.

Long-Term Equity-Based Incentives

We maintain the 2017 Omnibus Incentive Plan (the “2017 Plan”) pursuant to which we have granted our NEOs restricted stock, stock options or performance-based stock awards.

Annual Long-Term Incentive Grants

Restricted stock, stock options and performance awards may be awarded by our Compensation Committee after consideration of each individual’s performance toward our recent goals, as well as expected contributions to our long-term success. Our Compensation Committee believes that these forms of equity ownership help align the executive’s interests closely with those of our shareholders and incentivize our executives to contribute to the long-term growth and success of Carriage.

Our Compensation Committee established 2023 long-term incentive targets for our NEOs, as shown in the table below:

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Compensation Discussion and Analysis

All long-term incentive awards granted are tied to the future performance of the Company and align with long-term value creation interests for our shareholders. For the 2023 grant, as a result of the financial performance of the Company during the year ended December 31, 2022, our Compensation Committee, in its discretion, adjusted downward the long-term incentive grants for our NEOs.

The following chart describes the February 23, 2023 grant of long-term incentive awards to our NEOs: